Integra Micro Systems Private Limited Vs State of U.P. (Allahabad High Court)
Allahabad High Court, in Integra Micro Systems Private Limited vs. State of U.P., ruled in favor of the petitioner, setting aside a GST demand order due to procedural lapses. The case involved a tax demand of ₹2.11 crore under Section 74 of the GST Act, arising from an alleged wrongful Input Tax Credit (ITC) claim. The petitioner contended that the ITC was mistakenly availed but never utilized and had been rectified in subsequent returns. Despite this, a show cause notice was issued on June 21, 2022, followed by a demand order on March 25, 2023, without granting a personal hearing. The petitioner’s appeal was later dismissed on December 4, 2024, for being beyond the limitation period.
The court found that the show cause notice and reminder notices failed to mention the date, time, or venue for a personal hearing and mentioned merely the word NA. Furthermore, the department acknowledged that no hearing was granted before passing the final order. Section 75(4) of the GST Act explicitly requires that an opportunity for a hearing be provided before issuing an adverse order. The court relied on its previous ruling in Party Time Hospitality Prop. Punita Gupta v. State of U.P. (2023), which reaffirmed the mandatory nature of personal hearings under GST law.
